Accounting flashcards
What is the accounting equation?
Assets = Owner’s Equity + Liabilities
What are assets?
An item of property owned by a person or company
Give me examples of assets
Vehicles, land and buildings, equipment
What is a fixed asset
assets or property with a long life ( 12 months or more )
Give me an example of a fixed asset
land and buildings and equipment
What is a current asset
an asset that consists of cash and can be easily converted into cash with a short life ( less than 12 months )
What is liabilities?
an amount that a enterprise owes to another enterprise
Give me an example of a liability
loans, trading creditors, bank overdraft
What is a long term liability and also give me an example
a liability that can become payable within a period of one year and an example would be loans and mortgage
What is a current liability and give me an example of one
a liability that becomes payable within a period of a year
What’s another word for current liability
short term liability
What is capital
capital is an owners account where the owner puts money into the business to start up a business
what is drawings
drawings is also an owners account, where the owner takes money out the business for personal use
What is cash float
money kept in the cash register for change for customers
what is petty cash
specific amount made for small payments
What is journal
it is a book into which transactions of the same type, according to the different source documents, are entered
calculate selling price
cost price + gross profit
calculate cost price
selling price - gross profit
calculate gross profit
selling price - cost price
What are the 3 other words for trading stock
inventory, goods, stock
